Economy

Indo-Pak Tit-For-Tat Exchange Drags Stock Down

Karachi, March 2, 2019: Investors at Pakistan Stock Exchange were remained cautious throughout the last week in fear of the situation further escalating between Pakistan and India.

It was a tumultuous week for Pakistan equities as Pakistan and India exchanged tit-for-tat air strikes with one another for the first time since in several years.

According to Topline, tensions still remain high between the two countries even though the Captured Indian pilot Abhinandan Varthaman was handed back to Indian officials as a peace gesture from Pakistan.  Resultantly, the KSE-100 index lost 477 points WoW (or -1.2 percent), closing at 39,539 level.

Sector-wise the worst performers for the week were Cements, E&P’s and OMC’s as they chipped away 254 points, cumulatively. While on the other hand the Tobacco sector offered the index some respite as it added 92 points.

 Foreigners were net sellers of $1.3 million vs. net buyers of $3.5 million in the previous week, this ended their six consecutive-weeks of net buying. While on the local investors’ side, Individuals and Mutual Funds were net sellers of $21.3 million.

Analysts at JS said that although the technical charts were hinting at a correction at above 40,000 levels, the sharp decline during the week was majorly attributable to disturbing news on the political front.

The situation escalated between India and Pakistan after the Pulwama attack last week, and an Indian airplane was shot down in Pakistani territory by local armed forces.

A war-like situation was emerging which created panic among market participants and led to bearish momentum for the majority of the week. However, following televised statements by the Prime Minister of Pakistan and the promise of return of an Indian pilot, news flows suggested that the scenario had changed, which led to some recovery in the market in the latter part of the week.

Volumes during the week increased by 52 percent WoW to an average of 160 million shares per day, whereas average daily value traded  also jumped by 33 percent WoW to $51 million.

On a sector wise basis, Refinery (down 5.1 percent WoW), Engineering (down 5.6 percent WoW) and Cements (down 3.7 percent WoW) were among the major losers during the week.

 

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button
Close